Method 1: Sell out of money index options

This method has a low risk if managed properly. The basic idea is to sell both out of money call and put options for broad based stock market index such SP500. Firstly, you need to establish historical market volatility by calculate standard deviation of the proceeding 60 days. Then sell the next month's call and put options at 3 to 4 standard deviation away from current price. You probably will get 10 to 15 cents per contract (that is 100 to 150 dollars per contract). Then sit tight and wait for the contract to expire.

CAUTION: In a rapid move market, this method will fail. So, proper money management is very important for the success of this scheme. If at any time, the premier on any of your contract reaches 3 times what you paid for, you should take the loss immediately and don't hope.

About this blog

The purpose of this blog is to share ideas on making money slowly, surely and with low or no risk. This is in contrast to get rich quick (many of them are scams).